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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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Schedule 14D-9
SOLICITATION/RECOMMENDATION STATEMENT UNDER
SECTION 14(d)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
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CONVERIUM HOLDING AG
(Name of Subject Company)
CONVERIUM HOLDING AG
(Name of Person Filing Statement)
Registered Shares, Nominal Value CHF 5 Per Share
American Depositary Shares, each representing one half of one Registered Share
(Title of Class of Securities)
Registered Shares*
American Depository Shares (CUSIP: 21248N107)
(CUSIP Number of Class of Securities)
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Christian Felderer
Converium Holding AG
Dammstrasse 19
CH-6301 Zug
Switzerland
+41 44 639 9335
(Name, Address and Telephone Number of Person Authorized to Receive Notice and
Communications on Behalf of the Person Filing Statement)
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With copies to:
Gregory B. Astrachan, Esq.
Willkie Farr & Gallagher LLP
1 Angel Court
London EC2R 7HJ
England
+44 207 696 5454
*There is no CUSIP Number assigned to the Registered Shares.
|X| Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
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On March 2, 2007, Converium Holding AG included the following statement on
its website, including a hypertext link to the press release issued by Standard
& Poor's on February 28, 2007, which is set forth on page 3 of this Schedule
14D-9:
Converium's financial strength is currently followed by a number of rating
agencies including S&P, Moody's, Fitch and A.M. Best. Please note that any
opinions, estimates or forecasts regarding Converium's historical or predicted
financial strength or performance made by these rating agencies are theirs alone
and do not represent opinions, forecasts or predictions of Converium or its
management. Converium is providing the attached press release as a service to
its stockholders, and does not by so doing imply its endorsement of or
concurrence with such information, conclusions or recommendations. Interested
persons must obtain copies of rating agencies' reports on their own; Converium
does not distribute these reports.
Additional information and where to find it:
In connection with the offer by SCOR, Converium expects to file a
solicitation/recommendation statement with the Securities and Exchange
Commission (the "SEC"). Investors and security holders are strongly advised to
read these documents when they become available because they will contain
important information about the tender offer and the proposed merger. Copies of
the solicitation/recommendation statement will be available free of charge at
the SEC's web site at www.sec.gov, or at Converium's website at
www.converium.com.
Text of Standard & Poor's press release:
[GRAPHIC OMITTED][GRAPHIC OMITTED]
Swiss Reinsurer Converium AG And
Subsidiaries Ratings Raised To 'A-'
And Taken Off Watch Pos
Rationale
On Feb. 28, 2007, Standard & Poor's Ratings Services raised its long-term
counterparty credit and insurer financial strength ratings on Switzerland-based
reinsurer Converium AG and its long-term insurer financial strength ratings on
guaranteed operating entities Converium Rueckversicherung (Deutschland) AG and
Converium Insurance (U.K.) Ltd. to `A-' from 'BBB+'. At the same time, Standard
& Poor's removed these ratings from CreditWatch, where they had been placed with
positive implications on Oct. 17, 2006. The outlook on all entities is stable.
The upgrade reflects Standard & Poor's belief that the group (Converium)
will eventually settle with regulators on transactions subject to regulatory
inquiries, and it will do so at a cost that is not material to our view of group
capitalization. This follows analysis of a recent independent study commissioned
by Converium of settlements of SEC investigations. The study examined
settlements in more than 100 cases between July 30, 2002, and Feb. 20, 2007.
Settlements in cases involving groups with a market capitalization of $5 billion
or less ranged from $0-$50 million. Although the cost of a settlement is as yet
not certain, Standard & Poor's believes that Converium's capital adequacy would
remain consistent with that of the current rating level, even in the event of a
settlement considerably in excess of the upper limit of the indicated historical
range.
The ratings reflect the group's strengthened management team and sound
infrastructure, strong competitive position, and strong capitalization. These
positive factors are partially offset by current earnings that are good but
currently lower than what would be expected for the rating as well as the
relatively low barriers to entry of the reinsurance industry.
Publication Date Feb. 28, 2007
Swiss Reinsurer Converium AG And Subsidiaries Ratings Raised To A-' And Taken
Off Watch Pos
Outlook
The stable outlook reflects Standard & Poor's expectation that the combined
ratio for the group will be less than 100% in 2007 and the ROR will be in excess
of 10%. Controlled premium growth is expected over the next couple of years,
market conditions permitting. Most growth will be generated by the recovery of
shares on existing treaties lost as a result of cedents previously reducing
their exposure to the group or from the return of old clients. Capital adequacy,
as measured by Standard & Poor's risk-based model, will remain strong.
An outlook revision to positive is unlikely in the medium term, and would
depend on the group significantly outperforming targets over a sustained period.
The outlook would likely be revised to negative, however, if one or more of the
following events were to occur:
|X| SCOR S.A. (foreign currency A-/Stable/-, local currency A-/Stable/A-2) is
successful in its unsolicited bid, leading to potential integration risks
such as Converium seeing significant loss of key staff and/or support from
its key European client base.
|X| Unexpected material legacy costs arise in relation to loss-reserve
strengthening, regulatory sanction, or shareholder litigation.
Major Rating Factors
|X| Standard & Poor's believes that the group's infrastructure is sound.
Management action since 2004 has largely addressed previous operational
shortcomings, though controls have yet to be tested over a prolonged period
of time. Converium has benefited from additional infrastructure investment,
the refocusing of roles following senior management reorganization, and the
experience acquired through recent senior hires.
|X| Converium's competitive position is strong. Standard & Poor's believes that
despite past financial difficulties, the group has maintained the support
of key cedents. Long-term relationships, the material use of a direct
distribution model, and strategic partnerships (particularly within
specialty business lines), add competitive strength. The relatively low
barriers to entry of the reinsurance industry partially offset these
strengths.
|X| Capitalization is strong, supported by strong capital adequacy, an
aggregate claims reserve position enhanced further following the sale of
discontinued North American operations at the end of 2006, limited
retrocession dependence, and generally strong quality of retrocessionaires.
|X| Good nonlife operating performance is expected to be primarily driven by
sustained improvement from continuing nonlife operations and supported by
attractive underwriting conditions, limited volatility with regard to
legacy liabilities, and a reconfigured group expense base. The key
determinant of nonlife earnings in the longer term will be the speed at
which premium rates soften, Converium's cycle management response, and the
successful execution of group strategy.
Ratings List
Upgraded; CreditWatch/Outlook Action
To From
Converium AG
Counterparty Credit
Rating
Local Currency A-/Stable/- BBB+/Watch Pos/-
Financial Strength Rating
Local Currency A-/Stable/- BBB+/Watch Pos/-
Junior Subordinated
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Swiss Reinsurer Converium AG And Subsidiaries Ratings Raised To A-' And Taken
Off Watch Pos
Foreign Currency BBB BBB-/Watch Pos
Converium Insurance (U.K.) Ltd.
Converium Rueckversicherung (Deutschland) AG
Financial Strength Rating
Local Currency A-/Stable/- BBB+/Watch Pos/-
Complete ratings information is available to subscribers of RatingsDirect,
Standard & Poor's Web-based credit analysis system, at www.ratingsdirect.com.
All ratings affected by this rating action can be found on Standard & Poor's
public Web site at www.standardandpoors.com; under Credit Ratings in the left
navigation area, select Find a Rating, then Credit Ratings Search.
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